##### Table of Contents



UNITED STATES SECURITIES AND EXCHANGE COMMISSION
 Washington, D.C. 20549
 Form 10-Q
  þ
    
    QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE
ACT OF 1934
 For the Quarterly Period Ended March 31, 2006
 or
 o
    
    TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE
ACT OF 1934
 For the transition period from to
 Commission File Number: 000-25955
 Waste Services, Inc.
 (Exact name of registrant as specified in its charter)
 Delaware
    
    01-0780204(State or other jurisdiction of
    
    (I.R.S. Employerincorporation or organization)
    
    Identification No.)
 1122 International Blvd., Suite 601, Burlington, Ontario, Canada L7L 6Z8
 (905) 319-1237  (Registrants telephone number, including area code)
 þ o
  Large accelerated filer o
    
    Accelerated Filer þ
    
    Non-accelerated filer o
 o þ




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##### 



TABLE OF CONTENTS
 PagePART I  FINANCIAL INFORMATIONItem 1. Financial Statements.Condensed Consolidated Balance Sheets as of March 31, 2006 (unaudited) and December 31, 2005.
    
    
    2Unaudited Condensed Consolidated Statements of Operations for the three months ended March 31, 2006 and 2005.
    
    
    3Unaudited Condensed Consolidated Statement of Shareholders Equity for the three months ended March 31, 2006.
    
    
    4Unaudited Condensed Consolidated Statements of Cash Flows for the three months ended March 31, 2006 and 2005.
    
    
    5Notes to Unaudited Condensed Consolidated Financial Statements.
    
    
    6Item 2. Managements Discussion and Analysis of Financial Condition and Results of Operations.
    
    
    22Item 3. Quantitative and Qualitative Disclosures About Market Risk.
    
    
    33Item 4. Controls and Procedures.
    
    
    33PART II  OTHER INFORMATIONItem 1. Legal Proceedings.
    
    
    33Item 1A. Risk Factors.
    
    
    33Item 2. Unregistered Sales of Equity Securities and Use of Proceeds.
    
    
    33Item 3. Defaults upon Senior Securities.
    
    
    33Item 4. Submission of Matters to a Vote of Security Holders.
    
    
    33Item 5. Other Information.
    
    
    34Item 6. Exhibits.
    
    
    34Signatures.
    
    
    35Section 302 CEO CertificationSection 302 CFO CertificationSection 906 CEO and CFO Certification
  1




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##### Table of Contents



PART I. FINANCIAL INFORMATION
 
 Item 1. Financial Statements
 WASTE SERVICES, INC.
 
 CONDENSED CONSOLIDATED BALANCE SHEETS
 (In thousands, except share amounts)
 March 31,
    
    
    December 31,2006
    
    
    2005(Unaudited)ASSETSCurrent assets:Cash and cash equivalents
    
    $
    2,045
    
    
    $
    8,887Accounts receivable (net of allowance for doubtful accounts of
$1,182 and $925 as of March 31, 2006 and December 31, 2005, respectively)
    
    
    46,733
    
    
    
    49,583Prepaid expenses and other current assets
    
    
    10,738
    
    
    
    11,112Total current assets
    
    
    59,516
    
    
    
    69,582Property and equipment, net
    
    
    134,160
    
    
    
    133,263Landfill sites, net
    
    
    174,720
    
    
    
    172,128Goodwill and other intangible assets, net
    
    
    327,807
    
    
    
    329,471Other assets
    
    
    24,116
    
    
    
    23,945Total assets
    
    $
    720,319
    
    
    $
    728,389LIABILITIES AND SHAREHOLDERS EQUITYCurrent liabilities:Accounts payable
    
    $
    24,912
    
    
    $
    26,152Accrued expenses and other current liabilities
    
    
    44,606
    
    
    
    40,700Short-term financing and current portion of long-term debt
    
    
    1,430
    
    
    
    1,365Total current liabilities
    
    
    70,948
    
    
    
    68,217Long-term debt
    
    
    284,491
    
    
    
    284,850Accrued closure, post-closure and other obligations
    
    
    26,371
    
    
    
    25,860Cumulative mandatorily redeemable Preferred Stock (net of discount of
$696 and $2,347 as of March 31, 2006 and December 31, 2005, respectively)
    
    
    90,400
    
    
    
    84,971Total liabilities
    
    
    472,210
    
    
    
    463,898Shareholders equity:Common stock $0.01 par value; 500,000,000 shares authorized; 94,663,761 and
93,685,889 shares issued and outstanding as of March 31, 2006
and December 31, 2005, respectively
    
    
    947
    
    
    
    937Additional paid-in capital
    
    
    386,726
    
    
    
    383,618Treasury stock at cost; 500,000 shares
    
    
    (1,235
    )
    
    
    (1,235
    )Accumulated other comprehensive income
    
    
    34,938
    
    
    
    35,673Accumulated deficit
    
    
    (173,267
    )
    
    
    (154,502
    )Total shareholders equity
    
    
    248,109
    
    
    
    264,491Total liabilities and shareholders equity
    
    $
    720,319
    
    
    $
    728,389
  2




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##### Table of Contents



WASTE SERVICES, INC.
 
 UNAUDITED CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
 (In thousands, except per share data)
 Three Months Ended March 31,2006
    
    
    2005Revenue
    
    $
    95,682
    
    
    $
    88,985Operating and other expenses:Cost of operations (exclusive of depreciation, depletion
and amortization)
    
    
    68,295
    
    
    
    64,839Selling, general and administrative expense (exclusive of
depreciation, depletion and amortization)
    
    
    16,561
    
    
    
    15,118Impairment of deferred acquisition costs
    
    
    5,612
    
    
    
    Depreciation, depletion and amortization
    
    
    10,337
    
    
    
    9,549Foreign exchange gain and other
    
    
    (81
    )
    
    
    (238
    )Loss from operations
    
    
    (5,042
    )
    
    
    (283
    )Interest expense
    
    
    7,057
    
    
    
    6,825Cumulative mandatorily redeemable preferred stock dividends and
amortization of issue costs
    
    
    5,697
    
    
    
    4,842Loss before income taxes
    
    
    (17,796
    )
    
    
    (11,950
    )Income tax provision
    
    
    969
    
    
    
    2,317Net loss
    
    $
    (18,765
    )
    
    $
    (14,267
    )Basic and diluted loss per share:Loss per share  basic and diluted
    
    $
    (0.19
    )
    
    $
    (0.15
    )Weighted average common shares outstanding  basic and diluted
    
    
    100,132
    
    
    
    96,516
  3




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##### Table of Contents



WASTE SERVICES, INC.
 
 UNAUDITED CONDENSED CONSOLIDATED STATEMENT OF SHAREHOLDERS EQUITY
 For the Three Months Ended March 31, 2006
 (In thousands)
 AccumulatedOtherWaste Services, Inc.
    
    
    
    
    
    
    Treasury
    
    
    Comprehensive
    
    
    
    
    
    
    TotalCommon Stock
    
    
    Additional
    
    
    Shares
    
    
    Income
    
    
    Accumulated
    
    
    ShareholdersShares
    
    
    Amount
    
    
    Paid-in Capital
    
    
    at Cost
    
    
    (Loss)
    
    
    Deficit
    
    
    EquityBalance, December 31, 2005
    
    
    93,686
    
    
    $
    937
    
    
    $
    383,618
    
    
    $
    (1,235
    )
    
    $
    35,673
    
    
    $
    (154,502
    )
    
    $
    264,491Common shares and warrants issued
    
    
    946
    
    
    
    9
    
    
    
    2,905
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    2,914Exercise of options and warrants
    
    
    28
    
    
    
    1
    
    
    
    84
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    85Stock-based compensation
    
    
    
    
    
    
    
    
    
    
    1,048
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    1,048Conversion of exchangeable shares
    
    
    4
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    Share reimbursement agreement
    
    
    
    
    
    
    
    
    
    
    (929
    )
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    (929
    )Foreign currency translation adjustment
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    (735
    )
    
    
    
    
    
    
    (735
    )Net loss
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    (18,765
    )
    
    
    (18,765
    )Balance, March 31, 2006
    
    
    94,664
    
    
    $
    947
    
    
    $
    386,726
    
    
    $
    (1,235
    )
    
    $
    34,938
    
    
    $
    (173,267
    )
    
    $
    248,109
  4




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WASTE SERVICES, INC.
 
 UNAUDITED CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS
 (In thousands)
 Three Months Ended March 31,2006
    
    
    2005Cash flows from operating activities:Net loss
    
    $
    (18,765
    )
    
    $
    (14,267
    )Adjustments to reconcile net loss to net cash flows
from operating activities:Depreciation, depletion and amortization
    
    
    10,337
    
    
    
    9,549Cumulative mandatorily redeemable preferred stock dividends and
amortization of issue costs
    
    
    5,697
    
    
    
    4,842Amortization of debt issue costs
    
    
    388
    
    
    
    345Deferred income tax provision
    
    
    858
    
    
    
    2,161Non-cash stock-based compensation expense
    
    
    1,048
    
    
    
    506Impairment of deferred acquisition costs
    
    
    5,612
    
    
    
    Other non-cash items
    
    
    219
    
    
    
    143Changes in operating assets and liabilities (excluding the effects
of acquisitions):Accounts receivable
    
    
    2,784
    
    
    
    1,528Prepaid expenses and other current assets
    
    
    (582
    )
    
    
    1,197Accounts payable
    
    
    (828
    )
    
    
    (4,477
    )Accrued expenses and other current liabilities
    
    
    4,352
    
    
    
    2,75111,120
    
    
    
    4,278Cash flows from investing activities:Cash used in business combinations and significant asset
acquisitions, net of cash acquired
    
    
    
    
    
    
    (639
    )Capital expenditures
    
    
    (14,383
    )
    
    
    (6,804
    )Proceeds from asset sales and business divestitures
    
    
    371
    
    
    
    453Deposits for business acquisitions and other
    
    
    (3,555
    )
    
    
    (398
    )(17,567
    )
    
    
    (7,388
    )Cash flows from financing activities:Principal repayments of debt and capital lease obligations
    
    
    (485
    )
    
    
    (402
    )Sale of common shares and warrants
    
    
    
    
    
    
    7,125Proceeds from the exercise of options and warrants
    
    
    85
    
    
    
    (400
    )
    
    
    6,723Effect of exchange rate changes on cash and cash equivalents
    
    
    5
    
    
    
    (76
    )Increase (decrease) in cash and cash equivalents
    
    
    (6,842
    )
    
    
    3,537Cash and cash equivalents, beginning of period
    
    
    8,887
    
    
    
    8,507Cash and cash equivalents, end of period
    
    $
    2,045
    
    
    $
    12,044
  5




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##### Table of Contents



WASTE SERVICES, INC.
 
 NOTES TO UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
 1. Organization of Business and Basis of Presentation
      6




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##### Table of Contents



WASTE SERVICES, INC.
NOTES TO UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (Continued)
 Three months ended March 31,2006
    
    
    2005Options to purchase common shares
    
    
    6
    
    
    
    31Warrants to purchase common shares
    
    
    908
    
    
    
    1,653Dilutive securities
    
    
    914
    
    
    
    1,684
  2.
Share-Based Payments
     7




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WASTE SERVICES, INC.
NOTES TO UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (Continued)
 Net loss as reported
    
    $
    (14,267
    )Add: Employee compensation expense for equity awards included in the determination
of net loss as reported
    
    
    86Less: Stock based compensation expense for equity awards determined by the fair value
based method prescribed under Statement 123
    
    
    (2,449
    )Pro forma net loss
    
    $
    (16,630
    )Basic and diluted loss per share:As reported
    
    $
    (0.15
    )Pro forma
    
    $
    (0.17
    )
   Three Months Ended March 31,2006
    
    2005Annual dividend yield
    
    
    
    
    
    
    Weighted-average expected life (years)
    
    
    3.0
    
    
    
    N/ARisk-free interest rate
    
    
    4.83
    %
    
    
    N/AExpected volatility
    
    
    38
    %
    
    
    N/A
    Options
    
    OptionsOutstanding
    
    ExercisableNumber
of U.S. dollar denominated options
    
    
    7,846,500
    
    
    
    4,735,000Number
of Canadian dollar denominated options
    
    
    4,740,000
    
    
    
    4,556,500Total number of options
    
    
    12,586,500
    
    
    
    9,291,500Aggregate intrinsic value of options
    
    $0.1million
    
    $0.1millionWeighted average remaining contractual term (years)
    
    
    2.4
    
    
    
    2.0Weighted average exercise price  U.S. dollar denominated options
    
    $
    4.43
    
    
    $
    4.55Weighted average exercise price  Canadian dollar denominated options
    
    C$
    6.37
    
    
    C$
    6.37
  3. Allowance for Doubtful Accounts
  8




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WASTE SERVICES, INC.
NOTES TO UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (Continued)
   2006
    
    
    2005Balance, beginning of period
    
    $
    925
    
    
    $
    1,264Provisions
    
    
    623
    
    
    
    395Bad debts charged to reserves, net of recoveries
    
    
    (365
    )
    
    
    (609
    )Impact of foreign exchange rate fluctuations
    
    
    (1
    )
    
    
    (1
    )Balance, end of period
    
    $
    1,182
    
    
    $
    1,049
 4. Prepaid Expenses and Other Current Assets
  March 31,
    
    
    December 31,2006
    
    
    2005(Unaudited)Prepaid expenses
    
    $
    3,083
    
    
    $
    2,694Deferred income taxes
    
    
    3,749
    
    
    
    4,763Parts and supplies
    
    
    1,897
    
    
    
    1,832Other current assets
    
    
    2,009
    
    
    
    1,823$
    10,738
    
    
    $
    11,112
 5. Property and Equipment
  March 31,
    
    
    December 31,2006
    
    
    2005(Unaudited)Land and buildings
    
    $
    29,072
    
    
    $
    27,446Vehicles
    
    
    104,472
    
    
    
    103,120Containers, compactors and landfill and recycling equipment
    
    
    73,108
    
    
    
    71,228Furniture, fixtures, other office equipment and leasehold improvements
    
    
    10,725
    
    
    
    10,389Total property and equipment
    
    
    217,377
    
    
    
    212,183Less: Accumulated depreciation
    
    
    (83,217
    )
    
    
    (78,920
    )Property and equipment, net
    
    $
    134,160
    
    
    $
    133,263
 6. Landfill Sites, Accrued Closure, Post-Closure and Other Obligations
 Landfill Sites
  March 31,
    
    
    December 31,2006
    
    
    2005(Unaudited)Landfill sites
    
    $
    211,196
    
    
    $
    205,345Less: Accumulated depletion
    
    
    (36,476
    )
    
    
    (33,217
    )Landfill sites, net
    
    $
    174,720
    
    
    $
    172,128
  9




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##### Table of Contents



WASTE SERVICES, INC.
NOTES TO UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (Continued)
 2006
    
    
    2005Balance, beginning of period
    
    $
    172,128
    
    
    $
    169,616Additional landfill site costs
    
    
    5,566
    
    
    
    2,445Additional asset retirement obligations
    
    
    428
    
    
    
    229Depletion
    
    
    (3,361
    )
    
    
    (2,155
    )Effect of foreign exchange rate fluctuations
    
    
    (41
    )
    
    
    (96
    )Balance, end of period
    
    $
    174,720
    
    
    $
    170,039
 Accrued Closure, Post-Closure and Other Obligations
  March 31,
    
    
    December 31,2006
    
    
    2005(Unaudited)Accrued closure and post-closure obligations
    
    $
    9,693
    
    
    $
    9,106Deferred income tax liability
    
    
    16,086
    
    
    
    16,206Other obligations
    
    
    592
    
    
    
    548$
    26,371
    
    
    $
    25,860
  2006
    
    
    2005Balance, beginning of period
    
    $
    9,106
    
    
    $
    6,390Accretion
    
    
    187
    
    
    
    121Additional asset retirement obligations
    
    
    428
    
    
    
    229Effect of foreign exchange rate fluctuations
    
    
    (28
    )
    
    
    (27
    )Balance, end of period
    
    $
    9,693
    
    
    $
    6,713
 7. Goodwill and Other Intangible Assets
  March 31,
    
    
    December 31,2006
    
    
    2005(Unaudited)Other intangible assets subject to amortization:Customer relationships and contracts
    
    $
    35,381
    
    
    $
    35,394Non-competition agreements and other
    
    
    3,132
    
    
    
    3,13638,513
    
    
    
    38,530Less: Accumulated amortization:Customer relationships and contracts
    
    
    (13,409
    )
    
    
    (12,310
    )Non-competition agreements and other
    
    
    (2,143
    )
    
    
    (1,950
    )Other intangible assets subject to amortization, net
    
    
    22,961
    
    
    
    24,270Goodwill
    
    
    304,846
    
    
    
    305,201Goodwill and other intangible assets, net
    
    $
    327,807
    
    
    $
    329,471
  10




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WASTE SERVICES, INC.
NOTES TO UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (Continued)
 Three Months Ended March 31, 2006Florida
    
    
    Canada
    
    
    All Other
    
    
    TotalBalance, beginning of period
    
    $
    199,377
    
    
    $
    84,869
    
    
    $
    20,955
    
    
    $
    305,201Effect of foreign exchange rate fluctuations
    
    
    
    
    
    
    (355
    )
    
    
    
    
    
    
    (355
    )Balance, end of period
    
    $
    199,377
    
    
    $
    84,514
    
    
    $
    20,955
    
    
    $
    304,846
 Three Months Ended March 31, 2005Florida
    
    
    Canada
    
    
    All Other
    
    
    TotalBalance, beginning of period
    
    $
    174,629
    
    
    $
    85,255
    
    
    $
    20,946
    
    
    $
    280,830Acquisitions
    
    
    
    
    
    
    
    
    
    
    9
    
    
    
    9Effect of foreign exchange rate fluctuations
    
    
    
    
    
    
    (535
    )
    
    
    
    
    
    
    (535
    )Purchase price allocation adjustments for prior acquisitions
    
    
    23,933
    
    
    
    
    
    
    
    
    
    
    
    23,933Balance, end of period
    
    $
    198,562
    
    
    $
    84,720
    
    
    $
    20,955
    
    
    $
    304,237
  8. Other Assets
  March 31,
    
    
    December 31,2006
    
    
    2005(Unaudited)Debt and redeemable Preferred Stock issue costs,
net of accumulated amortization
of $5,443 and $4,761 as of March 31, 2006 and
December 31, 2005, respectively
    
    $
    8,774
    
    
    $
    9,428Acquisition deposits and deferred acquisition costs
    
    
    14,687
    
    
    
    13,815Other assets
    
    
    655
    
    
    
    702$
    24,116
    
    
    $
    23,945
  9. Debt
  March 31,
    
    
    December 31,2006
    
    
    2005(Unaudited)Senior Secured Credit Facilities:Term loan facility, floating interest rate at 7.9% as of
March 31, 2006 and December 31, 2005, due $313 per quarter to
March 2010, $29,500 per quarter thereafter, due March 2011
    
    $
    123,000
    
    
    $
    123,250Senior Subordinated Notes, fixed interest rate at 9.5%, due 2014
    
    
    160,000
    
    
    
    160,000Other subordinated promissory note payable, interest at 6.67%, due
through June 2017
    
    
    2,921
    
    
    
    2,965285,921
    
    
    
    286,215Less: Current portion
    
    
    (1,430
    )
    
    
    (1,365
    )Long-term portion
    
    $
    284,491
    
    
    $
    284,850
 11




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WASTE SERVICES, INC.
NOTES TO UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (Continued)
 Senior Secured Credit Facilities
      Senior Subordinated Notes
 1 2
  12




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WASTE SERVICES, INC.
NOTES TO UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (Continued)
   10. Cumulative Mandatorily Redeemable Preferred Stock
 3 4
   11. Commitments and Contingencies
 Environmental Risks
 13




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WASTE SERVICES, INC.
NOTES TO UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (Continued)
   Legal Proceedings
     Surety Bonds, Letters of Credit and Insurance
    14




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##### Table of Contents



WASTE SERVICES, INC.
NOTES TO UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (Continued)
 Three Months Ended March 31,2006
    
    
    2005Balance, beginning of period
    
    $
    4,356
    
    
    $
    2,426Provisions
    
    
    974
    
    
    
    637Payments
    
    
    (460
    )
    
    
    (106
    )Favorable claim development
    
    
    (315
    )
    
    
    (279
    )Balance, end of period
    
    $
    4,555
    
    
    $
    2,678
 Disposal Agreement
  Other Contractual Arrangements
   12. Authorized Capital Stock and Migration Transaction
 Total Shares
  
    
    500,000,000 shares of common stock, par value 0.01 per share; and
    
    5,000,000 shares of preferred stock, par value 0.01 per share, of which 100,000
shares have been designated as Series A Preferred Stock and one share has been designated as
Special Voting Preferred Stock.
 Common Stock
  Preferred Stock
  15




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##### Table of Contents



WASTE SERVICES, INC.
NOTES TO UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (Continued)
 Migration Transaction
     13. Comprehensive Loss
  2006
    
    
    2005Net loss
    
    $
    (18,765
    )
    
    $
    (14,267
    )Foreign currency translation adjustment
    
    
    (735
    )
    
    
    (1,226
    )Comprehensive loss
    
    $
    (19,500
    )
    
    $
    (15,493
    )
 14. Segment Information
   16




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##### Table of Contents



WASTE SERVICES, INC.
NOTES TO UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (Continued)
 Three Months Ended March 31, 2006All OtherFlorida
    
    Canada
    
    Operations
    
    Corporate
    
    TotalRevenue
    
    $
    48,393
    
    
    $
    39,207
    
    
    $
    8,082
    
    
    $
    
    
    
    $
    95,682Depreciation, depletion and
amortization
    
    
    5,273
    
    
    
    3,688
    
    
    
    991
    
    
    
    385
    
    
    
    10,337Income (loss) from operations
    
    
    5,504
    
    
    
    4,624
    
    
    
    (870
    )
    
    
    (14,300
    )
    
    
    (5,042
    )Capital expenditures
    
    
    7,342
    
    
    
    3,523
    
    
    
    2,996
    
    
    
    522
    
    
    
    14,383
 Three Months Ended March 31, 2005All OtherFlorida
    
    Canada
    
    Operations
    
    Corporate
    
    TotalRevenue
    
    $
    46,505
    
    
    $
    36,144
    
    
    $
    6,336
    
    
    $
    
    
    
    $
    88,985Depreciation, depletion and amortization
    
    
    4,709
    
    
    
    3,895
    
    
    
    681
    
    
    
    264
    
    
    
    9,549Income (loss) from operations
    
    
    3,500
    
    
    
    3,999
    
    
    
    (235
    )
    
    
    (7,547
    )
    
    
    (283
    )Capital expenditures
    
    
    3,446
    
    
    
    1,035
    
    
    
    1,804
    
    
    
    519
    
    
    
    6,804
 15. Condensed Consolidating Financial Statements
  17




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##### Table of Contents



WASTE SERVICES, INC.
NOTES TO UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (Continued)
 March 31, 2006Non-Guarantors
    
    
    Guarantors
    
    
    Eliminations
    
    
    ConsolidatedASSETSCurrent assets:Cash and cash equivalents
    
    $
    699
    
    
    $
    1,346
    
    
    $
    
    
    
    $
    2,045Accounts receivable, net
    
    
    25,735
    
    
    
    20,998
    
    
    
    
    
    
    
    46,733Prepaid expenses and other current assets
    
    
    3,432
    
    
    
    7,306
    
    
    
    
    
    
    
    10,738Total current assets
    
    
    29,866
    
    
    
    29,650
    
    
    
    
    
    
    
    59,516Property and equipment, net
    
    
    68,935
    
    
    
    65,225
    
    
    
    
    
    
    
    134,160Landfill sites, net
    
    
    164,790
    
    
    
    9,930
    
    
    
    
    
    
    
    174,720Goodwill and other intangible assets, net
    
    
    242,155
    
    
    
    85,652
    
    
    
    
    
    
    
    327,807Other assets
    
    
    15,736
    
    
    
    8,380
    
    
    
    
    
    
    
    24,116Due from affiliates
    
    
    
    
    
    
    6,153
    
    
    
    (6,153
    )
    
    
    Investment in subsidiary
    
    
    174,349
    
    
    
    
    
    
    
    (174,349
    )
    
    
    Total assets
    
    $
    695,831
    
    
    $
    204,990
    
    
    $
    (180,502
    )
    
    $
    720,319LIABILITIES AND SHAREHOLDERS EQUITYCurrent liabilities:Accounts payable
    
    $
    16,018
    
    
    $
    8,894
    
    
    $
    
    
    
    $
    24,912Accrued expenses and other current liabilities
    
    
    34,901
    
    
    
    9,705
    
    
    
    
    
    
    
    44,606Short-term financing and current
portion of long-term debt
    
    
    1,430
    
    
    
    
    
    
    
    
    
    
    
    1,430Total current liabilities
    
    
    52,349
    
    
    
    18,599
    
    
    
    
    
    
    
    70,948Longterm debt
    
    
    284,491
    
    
    
    
    
    
    
    
    
    
    
    284,491Accrued closure, post-closure and other obligations
    
    
    14,329
    
    
    
    12,042
    
    
    
    
    
    
    
    26,371Cumulative mandatorily redeemable Preferred Stock
    
    
    90,400
    
    
    
    
    
    
    
    
    
    
    
    90,400Due to affiliates
    
    
    6,153
    
    
    
    
    
    
    
    (6,153
    )
    
    
    Total liabilities
    
    
    447,722
    
    
    
    30,641
    
    
    
    (6,153
    )
    
    
    472,210Shareholders equity:Common stock of Waste Services, Inc
    
    
    947
    
    
    
    
    
    
    
    
    
    
    
    947Other equity
    
    
    247,162
    
    
    
    174,349
    
    
    
    (174,349
    )
    
    
    247,162Total shareholders equity
    
    
    248,109
    
    
    
    174,349
    
    
    
    (174,349
    )
    
    
    248,109Total liabilities and shareholders equity
    
    $
    695,831
    
    
    $
    204,990
    
    
    $
    (180,502
    )
    
    $
    720,319
 18




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##### Table of Contents



WASTE SERVICES, INC.
NOTES TO UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (Continued)
 December 31, 2005Non-Guarantors
    
    
    Guarantors
    
    
    Eliminations
    
    
    ConsolidatedASSETSCurrent assets:Cash and cash equivalents
    
    $
    3,681
    
    
    $
    5,206
    
    
    $
    
    
    
    $
    8,887Accounts receivable, net
    
    
    25,438
    
    
    
    24,145
    
    
    
    
    
    
    
    49,583Prepaid expenses and other current assets
    
    
    3,018
    
    
    
    8,094
    
    
    
    
    
    
    
    11,112Total current assets
    
    
    32,137
    
    
    
    37,445
    
    
    
    
    
    
    
    69,582Property and equipment, net
    
    
    67,354
    
    
    
    65,909
    
    
    
    
    
    
    
    133,263Landfill sites, net
    
    
    162,028
    
    
    
    10,100
    
    
    
    
    
    
    
    172,128Goodwill and other intangible assets, net
    
    
    243,276
    
    
    
    86,195
    
    
    
    
    
    
    
    329,471Other assets
    
    
    10,391
    
    
    
    13,554
    
    
    
    
    
    
    
    23,945Due from affiliates
    
    
    
    
    
    
    2,295
    
    
    
    (2,295
    )
    
    
    Investment in subsidiary
    
    
    177,883
    
    
    
    
    
    
    
    (177,883
    )
    
    
    Total assets
    
    $
    693,069
    
    
    $
    215,498
    
    
    $
    (180,178
    )
    
    $
    728,389LIABILITIES AND SHAREHOLDERS EQUITYCurrent liabilities:Accounts payable
    
    $
    14,665
    
    
    $
    11,487
    
    
    $
    
    
    
    $
    26,152Accrued expenses and other current liabilities
    
    
    27,911
    
    
    
    12,789
    
    
    
    
    
    
    
    40,700Short-term financing and current
portion of long-term debt
    
    
    1,365
    
    
    
    
    
    
    
    
    
    
    
    1,365Total current liabilities
    
    
    43,941
    
    
    
    24,276
    
    
    
    
    
    
    
    68,217Longterm debt
    
    
    284,850
    
    
    
    
    
    
    
    
    
    
    
    284,850Accrued closure, post-closure and other obligations
    
    
    12,521
    
    
    
    13,339
    
    
    
    
    
    
    
    25,860Cumulative mandatorily redeemable Preferred Stock
    
    
    84,971
    
    
    
    
    
    
    
    
    
    
    
    84,971Due to affiliates
    
    
    2,295
    
    
    
    
    
    
    
    (2,295
    )
    
    
    Total liabilities
    
    
    428,578
    
    
    
    37,615
    
    
    
    (2,295
    )
    
    
    463,898Shareholders equity:Common stock of Waste Services, Inc
    
    
    937
    
    
    
    
    
    
    
    
    
    
    
    937Other equity
    
    
    263,554
    
    
    
    177,883
    
    
    
    (177,883
    )
    
    
    263,554Total shareholders equity
    
    
    264,491
    
    
    
    177,883
    
    
    
    (177,883
    )
    
    
    264,491Total liabilities and shareholders equity
    
    $
    693,069
    
    
    $
    215,498
    
    
    $
    (180,178
    )
    
    $
    728,389
 19




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##### Table of Contents



WASTE SERVICES, INC.
NOTES TO UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (Continued)
 Three Months Ended March 31, 2006Non-Guarantors
    
    
    Guarantors
    
    
    Eliminations
    
    
    ConsolidatedRevenue
    
    $
    56,475
    
    
    $
    39,207
    
    
    $
    
    
    
    $
    95,682Operating and other expenses:Cost of operations (exclusive of depreciation,
depletion and amortization)
    
    
    40,955
    
    
    
    27,340
    
    
    
    
    
    
    
    68,295Selling, general and administrative expense (exclusive
of depreciation, depletion and amortization)
    
    
    10,489
    
    
    
    6,072
    
    
    
    
    
    
    
    16,561Impairment of deferred acquisition costs
    
    
    438
    
    
    
    5,174
    
    
    
    
    
    
    
    5,612Depreciation, depletion and amortization
    
    
    6,273
    
    
    
    4,064
    
    
    
    
    
    
    
    10,337Foreign exchange gain and other
    
    
    56
    
    
    
    (137
    )
    
    
    
    
    
    
    (81
    )Equity loss in investees
    
    
    3,008
    
    
    
    
    
    
    
    (3,008
    )
    
    
    Loss from operations
    
    
    (4,744
    )
    
    
    (3,306
    )
    
    
    3,008
    
    
    
    (5,042
    )Interest expense
    
    
    6,961
    
    
    
    96
    
    
    
    
    
    
    
    7,057Cumulative mandatorily redeemable preferred stock
dividends and amortization of issue costs
    
    
    5,697
    
    
    
    
    
    
    
    
    
    
    
    5,697Loss before income taxes
    
    
    (17,402
    )
    
    
    (3,402
    )
    
    
    3,008
    
    
    
    (17,796
    )Income tax provision
    
    
    1,363
    
    
    
    (394
    )
    
    
    
    
    
    
    969Net loss attributable to Common Shareholders
    
    $
    (18,765
    )
    
    $
    (3,008
    )
    
    $
    3,008
    
    
    $
    (18,765
    )
 Three Months Ended March 31, 2005Non-Guarantors
    
    
    Guarantors
    
    
    Eliminations
    
    
    ConsolidatedRevenue
    
    $
    52,841
    
    
    $
    36,144
    
    
    $
    
    
    
    $
    88,985Operating and other expenses:Cost of operations
(exclusive of depreciation,
depletion and amortization)
    
    
    39,861
    
    
    
    24,978
    
    
    
    
    
    
    
    64,839Selling, general and
administrative expense (exclusive
of depreciation, depletion and amortization)
    
    
    9,275
    
    
    
    5,843
    
    
    
    
    
    
    
    15,118Depreciation, depletion and amortization
    
    
    5,410
    
    
    
    4,139
    
    
    
    
    
    
    
    9,549Foreign exchange gain and other
    
    
    (82
    )
    
    
    (156
    )
    
    
    
    
    
    
    (238
    )Equity earnings in investees
    
    
    (279
    )
    
    
    
    
    
    
    279
    
    
    
    Income (loss) from operations
    
    
    (1,344
    )
    
    
    1,340
    
    
    
    (279
    )
    
    
    (283
    )Interest expense
    
    
    6,718
    
    
    
    107
    
    
    
    
    
    
    
    6,825Cumulative mandatorily
redeemable preferred stock
dividends and amortization of issue costs
    
    
    4,842
    
    
    
    
    
    
    
    
    
    
    
    4,842Loss before income taxes
    
    
    (12,904
    )
    
    
    1,233
    
    
    
    (279
    )
    
    
    (11,950
    )Income tax provision
    
    
    1,363
    
    
    
    954
    
    
    
    
    
    
    
    2,317Net loss attributable to Common Shareholders
    
    $
    (14,267
    )
    
    $
    279
    
    
    $
    (279
    )
    
    $
    (14,267
    )
 20




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##### Table of Contents



WASTE SERVICES, INC.
NOTES TO UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (Continued)
 Three Months Ended March 31, 2006Non-Guarantors
    
    
    Guarantors
    
    
    Eliminations
    
    
    ConsolidatedCash flows from operating activities:
    
    $
    6,814
    
    
    $
    4,306
    
    
    $
    
    
    
    $
    11,120Cash flows from investing activities:Capital expenditures
    
    
    (10,522
    )
    
    
    (3,861
    )
    
    
    
    
    
    
    (14,383
    )Proceeds from asset sales and business divestitures
    
    
    94
    
    
    
    277
    
    
    
    
    
    
    
    371Deposits for business acquisitions and other
    
    
    (3,557
    )
    
    
    2
    
    
    
    
    
    
    
    (3,555
    )Intercompany
    
    
    
    
    
    
    (4,398
    )
    
    
    4,398
    
    
    
    (13,985
    )
    
    
    (7,980
    )
    
    
    4,398
    
    
    
    (17,567
    )Cash flows from financing activities:Principal repayments of debt and capital
lease obligations
    
    
    (293
    )
    
    
    (191
    )
    
    
    
    
    
    
    (484
    )Proceeds from the exercise of options and warrants
    
    
    84
    
    
    
    
    
    
    
    
    
    
    
    84Intercompany
    
    
    4,398
    
    
    
    
    
    
    
    (4,398
    )
    
    
    4,189
    
    
    
    (191
    )
    
    
    (4,398
    )
    
    
    (400
    )Effect of exchange rate changes on cash and cash equivalents
    
    
    
    
    
    
    5
    
    
    
    
    
    
    
    5Increase in cash and cash equivalents
    
    
    (2,982
    )
    
    
    (3,860
    )
    
    
    
    
    
    
    (6,842
    )Cash and cash equivalents, beginning of period
    
    
    3,681
    
    
    
    5,206
    
    
    
    
    
    
    
    8,887Cash and cash equivalents, end of period
    
    $
    699
    
    
    $
    1,346
    
    
    $
    
    
    
    $
    2,045
 Three Months Ended March 31, 2005Non-Guarantors
    
    
    Guarantors
    
    
    Eliminations
    
    
    ConsolidatedCash flows from operating activities:
    
    $
    (777
    )
    
    $
    5,055
    
    
    $
    
    
    
    $
    4,278Cash flows from investing activities:Cash used in business combinations and significant
asset acquisitions, net of cash acquired
    
    
    (639
    )
    
    
    
    
    
    
    
    
    
    
    (639
    )Capital expenditures
    
    
    (5,253
    )
    
    
    (1,551
    )
    
    
    
    
    
    
    (6,804
    )Proceeds from asset sales and business divestitures
    
    
    130
    
    
    
    323
    
    
    
    
    
    
    
    453Deposits for business acquisitions and other
    
    
    11
    
    
    
    (409
    )
    
    
    
    
    
    
    (398
    )Intercompany
    
    
    
    
    
    
    (3,641
    )
    
    
    3,641
    
    
    
    (5,751
    )
    
    
    (5,278
    )
    
    
    3,641
    
    
    
    (7,388
    )Cash flows from financing activities:Principal repayments of debt and capital
lease obligations
    
    
    (290
    )
    
    
    (112
    )
    
    
    
    
    
    
    (402
    )Sale of common shares and warrants
    
    
    7,125
    
    
    
    
    
    
    
    
    
    
    
    7,125Intercompany
    
    
    3,641
    
    
    
    
    
    
    
    (3,641
    )
    
    
    10,476
    
    
    
    (112
    )
    
    
    (3,641
    )
    
    
    6,723Effect of exchange rate changes on cash and cash equivalents
    
    
    
    
    
    
    (76
    )
    
    
    
    
    
    
    (76
    )Increase in cash and cash equivalents
    
    
    3,948
    
    
    
    (411
    )
    
    
    
    
    
    
    3,537Cash and cash equivalents, beginning of period
    
    
    6,223
    
    
    
    2,284
    
    
    
    
    
    
    
    8,507Cash and cash equivalents, end of period
    
    $
    10,171
    
    
    $
    1,873
    
    
    $
    
    
    
    $
    12,044
 21




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##### Table of Contents



Item 2. Managements Discussion and Analysis of Financial Condition and Results of Operations
  Overview
  Sources of Revenue
       22




---



##### Table of Contents



Expense Structure
       Recent Developments
   23




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##### Table of Contents



Results of Operations for the Three Months Ended March 31, 2006 and 2005
   Three Months Ended March 31, 2006US
    
    
    
    
    
    
    Canada
    
    
    
    
    
    
    TotalRevenue
    
    $
    56,475
    
    
    
    100.0
    %
    
    $
    39,207
    
    
    
    100.0
    %
    
    $
    95,682
    
    
    
    100.0
    %Operating expenses:Cost of operations
    
    
    40,955
    
    
    
    72.5
    %
    
    
    27,340
    
    
    
    69.7
    %
    
    
    68,295
    
    
    
    71.4
    %Selling, general and administrative expense
    
    
    10,489
    
    
    
    18.6
    %
    
    
    6,072
    
    
    
    15.5
    %
    
    
    16,561
    
    
    
    17.3
    %Impairment of deferred acquisition costs
    
    
    438
    
    
    
    0.8
    %
    
    
    5,174
    
    
    
    13.2
    %
    
    
    5,612
    
    
    
    5.9
    %Depreciation, depletion and amortization
    
    
    6,273
    
    
    
    11.1
    %
    
    
    4,064
    
    
    
    10.4
    %
    
    
    10,337
    
    
    
    10.8
    %Foreign exchange loss (gain) and other
    
    
    56
    
    
    
    0.1
    %
    
    
    (137
    )
    
    
    -0.4
    %
    
    
    (81
    )
    
    
    -0.1
    %Loss from operations
    
    $
    (1,736
    )
    
    
    -3.1
    %
    
    $
    (3,306
    )
    
    
    -8.4
    %
    
    $
    (5,042
    )
    
    
    -5.3
    %
 Three Months Ended March 31, 2005US
    
    
    
    
    
    
    Canada
    
    
    
    
    
    
    TotalRevenue
    
    $
    52,841
    
    
    
    100.0
    %
    
    $
    36,144
    
    
    
    100.0
    %
    
    $
    88,985
    
    
    
    100.0
    %Operating expenses:Cost of operations
    
    
    39,861
    
    
    
    75.4
    %
    
    
    24,978
    
    
    
    69.1
    %
    
    
    64,839
    
    
    
    72.9
    %Selling, general and administrative expense
    
    
    9,275
    
    
    
    17.6
    %
    
    
    5,843
    
    
    
    16.2
    %
    
    
    15,118
    
    
    
    17.0
    %Depreciation, depletion and amortization
    
    
    5,410
    
    
    
    10.2
    %
    
    
    4,139
    
    
    
    11.5
    %
    
    
    9,549
    
    
    
    10.7
    %Foreign
exchange gain and other
    
    
    (82
    )
    
    
    -0.1
    %
    
    
    (156
    )
    
    
    -0.5
    %
    
    
    (238
    )
    
    
    -0.3
    %Income (loss) from operations
    
    $
    (1,623
    )
    
    
    -3.1
    %
    
    $
    1,340
    
    
    
    3.7
    %
    
    $
    (283
    )
    
    
    -0.3
    %
 24




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##### Table of Contents



Revenue
  Three Months Ended March 31,2006
    
    
    
    
    
    
    2005Collection
    
    $
    79,193
    
    
    
    76.1
    %
    
    $
    75,340
    
    
    
    79.0
    %Landfill disposal
    
    
    12,632
    
    
    
    12.1
    %
    
    
    7,723
    
    
    
    8.1
    %Transfer station
    
    
    9,266
    
    
    
    8.9
    %
    
    
    8,728
    
    
    
    9.1
    %Material recovery facilities
    
    
    2,368
    
    
    
    2.3
    %
    
    
    2,802
    
    
    
    2.9
    %Other specialized services
    
    
    598
    
    
    
    0.6
    %
    
    
    844
    
    
    
    0.9
    %104,057
    
    
    
    100.0
    %
    
    
    95,437
    
    
    
    100.0
    %Intercompany elimination
    
    
    (8,375
    )
    
    
    
    
    
    
    (6,452
    )$
    95,682
    
    
    
    
    
    
    $
    88,985
 Three Months Ended
    
    
    
    
    
    
    
    
    
    All Other
    
    TotalMarch 31,
    
    Florida
    
    Canada
    
    Operations
    
    Revenue2006
    
    $
    48,393
    
    
    $
    39,207
    
    
    $
    8,082
    
    
    $
    95,6822005
    
    
    46,505
    
    
    
    36,144
    
    
    
    6,336
    
    
    
    88,985
    Cost of Operations
    25




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##### Table of Contents



Selling, General and Administrative Expense
  Impairment of Deferred Acquisition Costs
  Depreciation, Depletion and Amortization
  Foreign Exchange Gain and Other
  Interest Expense
  Three Months Ended March 31,2006
    
    
    2005Preferred Stock dividends and amortization of issue costs
    
    $
    5,697
    
    
    $
    4,842Credit
Facilities and Subordinated Note interest
    
    
    6,620
    
    
    
    6,428Amortization of debt issue costs
    
    
    388
    
    
    
    345Other interest expense
    
    
    49
    
    
    
    52$
    12,754
    
    
    $
    11,667
 26




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##### Table of Contents



Income Tax Provision
  Liquidity and Capital Resources
  Senior Secured Credit Facilities
     27




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##### Table of Contents



Maximum ConsolidatedMaximum Consolidated
    
    Senior Secured Leverage
    
    Minimum ConsolidatedFiscal Quarter
    
    Leverage Ratio
    
    Ratio
    
    Interest Coverage RatioFQ1 2006
    
    
    5.25:1.00
    
    
    
    2.25:1.00
    
    
    
    2.00:1.00FQ2 2006
    
    
    5.25:1.00
    
    
    
    2.25:1.00
    
    
    
    2.00:1.00FQ3 2006
    
    
    5.00:1.00
    
    
    
    2.25:1.00
    
    
    
    2.00:1.00FQ4 2006
    
    
    4.75:1.00
    
    
    
    2.25:1.00
    
    
    
    2.25:1.00FQ1 2007
    
    
    4.75:1.00
    
    
    
    2.25:1.00
    
    
    
    2.25:1.00
 Senior Subordinated Notes
 1 2
  Equity Placement
  Cumulative Mandatory Redeemable Preferred Stock
   Migration Transaction
  28




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##### Table of Contents



Surety Bonds, Letters of Credit and Insurance
   Cash Flows
  Cash Flows from Operating Activities
  Cash Flows from Investing Activities
   Cash Flows from Financing Activities
  29




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##### Table of Contents



Off-Balance Sheet Financing
  Landfill Sites
  March 31, 2006Balance,Beginning of
    
    
    Airspace
    
    
    Balance, End ofPeriod
    
    
    Consumed
    
    
    PeriodUnited StatesPermitted Capacity
    
    
    266,088
    
    
    
    (703
    )
    
    
    265,385Probable expansion capacity
    
    
    18,300
    
    
    
    
    
    
    
    18,300Total available airspace
    
    
    284,388
    
    
    
    (703
    )
    
    
    283,685Number of landfill sites
    
    
    4
    
    
    
    
    
    
    
    4CanadaPermitted Capacity
    
    
    11,878
    
    
    
    (84
    )
    
    
    11,794Probable expansion capacity
    
    
    
    
    
    
    
    
    
    
    Total available airspace
    
    
    11,878
    
    
    
    (84
    )
    
    
    11,794Number of landfill sites
    
    
    3
    
    
    
    
    
    
    
    3TotalPermitted Capacity
    
    
    277,966
    
    
    
    (787
    )
    
    
    277,179Probable expansion capacity
    
    
    18,300
    
    
    
    
    
    
    
    18,300Total available airspace
    
    
    296,266
    
    
    
    (787
    )
    
    
    295,479Number of landfill sites
    
    
    7
    
    
    
    
    
    
    
    7
 Trend Information
 Seasonality
  30




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##### Table of Contents



New Accounting Pronouncements
  31




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##### Table of Contents



Disclosure Regarding Forward-Looking Statements and Factors Affecting Future Results
   
    
    our substantial indebtedness and the significant restrictive covenants in our various
credit facilities and our ability to finance acquisitions with cash on hand, debt or equity
offerings;
    
    our ability to implement a refinancing plan for our mandatorily redeemable preferred
stock and to achieve the expected benefits;
    
    our ability to maintain and perform our financial assurance obligations;
    
    changes in regulations affecting our business and costs of compliance;
    
    revocation of existing permits and licenses or the refusal to renew or grant new permits
and licenses, which are required to enable us to operate our business or implement our
growth strategy;
    
    our ability to successfully implement our corporate strategy and integrate any acquisitions we undertake;
    
    our ability to negotiate renewals of existing service agreements at favorable rates;
    
    our ability to enhance profitability of certain aspects of our operations in markets
where we are not internalized through either divestiture or asset swaps;
    
    costs and risks associated with litigation;
    
    changes in general business and economic conditions, changes in exchange rates and in the financial markets;
    
    changes in accounting standards or pronouncements; and
    
    construction, equipment delivery or permitting delays for our transfer stations or landfills.
  32




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##### Table of Contents



Item 3. Quantitative and Qualitative Disclosures About Market Risk
   
 Item 4. Controls and Procedures
 Disclosure Controls and Procedures/Evaluation of Disclosure Controls and Procedures
  Changes in Internal Controls Over Financial Reporting
  
 PART II. OTHER INFORMATION
 
 Item 1. Legal Proceedings
  
 Item 1A. Risk Factors
  
 Item 2. Unregistered Sales of Equity Securities and Use of Proceeds
  
 Item 3. Defaults upon Senior Securities
  
 Item 4. Submission of Matters to a Vote of Security Holders
 33




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##### Table of Contents



Item 5. Other Information
  
 Item 6. Exhibits
 Exhibit 31.1 
    
    Section 302 Certification of David Sutherland-Yoest, Chief Executive Officer
 Exhibit 31.2 
    
    Section 302 Certification of Mark A. Pytosh, Chief Financial Officer
 Exhibit 32.1 
    
    Section 1350 Certification of the Chief Executive Officer and Chief Financial Officer
 34




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##### Table of Contents



SIGNATURES
  Date: April 28, 2006
    Waste Services, Inc.By:
    /s/ DAVID SUTHERLAND-YOESTDavid Sutherland-YoestChairman of the Board,
Chief Executive Officer, and Director By:
    /s/ MARK A. PYTOSHMark A. PytoshExecutive Vice President and
Chief Financial Officer 35




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##### Table of Contents



EXHIBIT INDEX
 Exhibit No.
    
    
    
    DescriptionExhibit 31.1
    
    
    
    Section 302 Certification of David Sutherland-Yoest, Chief Executive OfficerExhibit 31.2
    
    
    
    Section 302 Certification of Mark A. Pytosh, Chief Financial OfficerExhibit 32.1
    
    
    
    Section 1350 Certification of the Chief Executive Officer and Chief Financial Officer
 36